"As those properties up the ladder change hands this will free up those homes at the bottom of the market for first time buyers in future months."
There were 65,887 loans (seasonally adjusted) approved in June, compared with the 64,645 recorded during May. This total is also 1.4% higher than at the same point during 2016.
However just 18.5% of all loans went to small deposit borrowers - below the 21.3% recorded last month and further back from the 2017 high of 21.5%, recorded in April.
But this is still well above the most recent low, recorded in December 2016, when those with small deposits represented just 16.1% of the market.
Large deposit buyers – defined as those with a deposit of 60% or more – accounted for 34.5% of the total home loan market this month. This is higher than in May 2017, when these borrowers made up 33.9% of the overall pool.
However, this is the fifth successive month that those with large deposits have accounted for less than 35% of the total market.
These changes meant the ‘mid-market’ borrowers saw their share of approvals edge closer to the 50% mark. Some 47% of all mortgages went to this part of the market in June, up from the 44.8% the month before.
Yorkshire remains the top spot for small deposit buyers. First-time buyers and those with small deposits are proportionately more likely to have a mortgage application approved in Yorkshire than anywhere else in the UK.
Some 28.1% of all loans in the region were made to small deposit buyers during June 2017. This put Yorkshire ahead of nearest challengers the North West (26.3%) and Northern Ireland (25.7%). These were the only three areas to have more than a quarter of loans given to small deposit borrowers.
At the other end of the scale, London was the region which saw the smallest proportion of small deposit loans approved. This month only 14.3% of loans were to this part of the market, compared to 17.9% last month.
Only two regions saw more loans go to small deposit buyers than their large deposit counterparts. They were Yorkshire, where 28.1% of loans went to small borrowers versus 24.2% for bigger ones, and in the North West, where the ratio was 26.3% versus 25.3%.
Richard Sexton, director of e.surv, commented: “It is great news that the mortgage market is growing once again. Approvals are up both compared to last month and June 2016.
“With the whole market moving this means that homeowners are able to move up the ladder, or to downsize if they need to. This also creates room at the bottom for first-time buyers to jump onto the ladder in future months.
“While the number of small deposit buyers being approved for mortgages has fallen, this should not be seen as a negative.
“As those properties up the ladder change hands this will free up those homes at the bottom of the market for first time buyers in future months. This allows the cycle of growth to continue.”
